Tesco Bengaluru Adds Variable Pay to Fixed Pay in Augmented Performance Process

Bengaluru, January 24, 2017: Tesco Bengaluru, the technology and retail operations team for Tesco worldwide, today announced changes to its performance management review system, adding the Variable Pay component to the Fixed Pay and moving to an annual review process that involves periodic feedback. With effect from May 1, 2017, Tesco Bengaluru is adopting a simpler, predictable and consistent model of assessment for its colleagues that encourages every day conversations leading to improved performance.

Tesco Bengaluru colleagues will now receive their Variable Pay component as a part of their monthly fixed salary pay-out and performance of colleagues will be assessed once a year, replacing the current bi-annual process. This ensures the review process is focused more on coaching and real time feedback, thus becoming less transactional in nature. It will enable colleagues and managers to focus on improving capabilities across the organisation

The move is in effect owing to an ongoing performance management process - Inspiring Great Performance Every Day (IGPED). It refers to not just ‘what’ colleagues do in their job, but about ‘how’ they do their job. IGPED encourages regular, in-the-moment, inspiring ‘conversations’ focused on improving colleague performance, and enables consistent development. It aligns with the company’s appraisal and rewards philosophy. The richer performance conversations where managers coach employees on improving their capabilities will have employees play a lead role in setting goals for themselves and driving their own development plans, rather than measuring the value of employees’ contributions and assigning a monetary value such as Variable Pay.

Krity Sharma, Head – People, Tesco Bengaluru, says, “While most companies differentiate employees based on salaries and link that to performance, here the attention is on trusting colleagues to do their job. This change in the environment encourages the manager and colleague to not only connect as individuals, but also creates better roles, pushes for better targets, and enables colleagues to do things that surpass their learning. We are also helping colleagues have performance discussions that feel natural and aspirational, thus creating a positive work environment, where colleagues feel happy, valued, and inspired to perform better”.

Apart from the annual pay review system, Tesco Bengaluru also uses deferred cash incentives, learning & development opportunities, career progression- talent moves, internal job postings/moves, promotions, and lateral pay hikes for the growth of their colleagues.